Cloud Computing has been quite the buzz word for the last few years and rightfully so. From PC OS vendors like Microsoft and Apple to data storage vendors to mobile handset OS developers, everybody has been talking about moving “it” to the cloud. So what does the “it” refer to and why is the “cloud” so important.

To understand the value proposition of the cloud architecture, look no further than salesforce.com and Amazon Elastic Services. When Oracle and SAP were trying to get the enterprise to commit to heavy duty hardware and software to run their tools, Marc Benioff came in and said, away with all those. He offered small and medium businesses a completely web based on-demand service (termed as SaaS or Software as a Service) to manage everything that Oracle and SAP allowed them to do at a fraction of the cost. This was truly a revolution.

Fast forward a few years later to the Amazon story. Amazon, not content with its tremendous success with its ecommerce platform was experimenting with its own version of cloud based computing that would allow small and medium businesses to rely on Amazon’s computing infrastructure to crunch massive amounts of data at a per byte/per minute/ per computation cost. This lowered the barrier of entry for startups that needed the computing power without the significant initial investment. Amazon Elastic Compute Cloud (EC2) is now a big hit for the company and is starting to contribute in a small way to the giant’s bottom line.

A recent yet incredibly successful attempt at Cloud services is the Google Apps system. The solution from Google, free for most users and for a small fee for SME’s has been a big success story. It has truly questioned the Microsoft domination of the word processing and office documentation segment. It has also offered cloud based storage of such documents. It has been so popular that MS had to launch its online version of its Office toolset called Office Live to combat the threat.

All this brings us to the cloud based battle brewing in the mobile space. Google with its pioneering Apps service has a headstart on the rest by integrating a lot of its cloud services on the Android OS. While the success of its recently launched Kin handsets for teens is debatable, Microsoft has a legitimate smart approach to cloud storage of mobile data with its Kin Studio service. There is now talk that Apple will make its MobileMe service, currently offered to Mac customers for $99 a year will become a free part of the Apple iPhone user experience. It makes no sense for Apple to charge for services that Google and Microsoft offer for free. Rumors seem to indicate that it will indeed become free as of this WWDC.

It is obvious that cloud computing and cloud storage is the way forward, be it for enterprises and their complex software or a mobile device with rich user content. Most of us are incredibly dependent on the cloud – we just haven’t realized it yet.